31-1784 Stena †B 2000_eng - The Stena Sphere

KOMMENTAR CEO COMMENTS
FRÅN CEO
Based on an increasing depletion rate
for fields outside OPECof 8% per year and
an increasing demand, it is our belief that
we shall have an interesting period in
front of us. OPEC will be busy developing
their own fields. A constraint is the big
oil-companies’ reluctance to commit
funds as long as dividends and share
buy backs are still in fashion.
Tanker shipping is booming
Due to the reduced investments in production
outside OPEC during 20 months
a considerable shift in production has
taken place to the benefit of the OPEC
countries, resulting in an increased
demand for transportation of crude oil.
As the refineries in the Western world
are running up to their full capacity,
transportation of product cargoes has
increased dramatically in new directions
and patterns. These two factors are now
leading to a high capacity utilization of
practically all tankers, regardless of size,
above 13,000 tons deadweight. It is probable
that the increased trade in products
will remain due to higher price differences
for various crude qualities and due
to the fact that there are no big projects
for refineries in the Western world.
The order book for tankers is alarmingly
big and full. Many argue though
that phasing out of tonnage will be large
in consequence of new rules and tighter
controls by port states and classification
societies. Hence overcapacity might not
occur. An imminent reduction in OPEC
production, with the objective to
4 Stena AB
increase price, will however reduce the
need for transportation. For how long such
a reduction will last is difficult to predict.
All in all based on how year 2001 has
started we are happy about our exposure
to the tanker market. Our long prediction
that our tankers, with their remaining
life of 30 years in benign waters, will be
converted to FPSOs or FSOs, have
proved to be right. Two vessels, one for
Stena and one for Concordia Maritime,
were sold last year and have now been
successfully delivered.
The co-operation with Texaco in
StenTex has resulted in the fact that the
volume handled by StenTex now is running
at a rate of 1,900 fixtures a year, an
increase from last year of 46%. Texaco
traders have had an excellent year and
StenTex have saved musd 20for Texaco
through the freight forward market.
In the spring we ordered an evolutionary
type of 10,000 tons deadweight
coastal tanker (Stena c-max) with double
propellers and double hull. The two vessels
are intended for Texaco’s trade in
the narrow straits and shallow waters
between the Caribbean islands with
their very sensitive scenery. The extra
safety required here is paramount and is
met by the extra manoeuvrability two
propellers can guarantee. The vessel can
turn in a cycle with a radius of 1/5 of
what a one propeller ship can do and
can continue operation or stop, if one
engine or one propeller for whatever
reason, would cease working.
RoRo and ferry markets are active
During the year we have sold one vessel,
the Stena Challenger, and ordered two
new RoPax vessels. The two RoPax vessels
under construction in Spain, have
been delivered at the time of writing and
are now successfully trading between
Harwich and Hoek van Holland. The
two ships are replacing three, while at
the same time, they are increasing the
capacity for cargo as well as introducing
beds for night passengers and good
capacity for day passengers.
The two vessels ordered during the
year are similar to the four ships built in
Spain. The construction in China of our
three RoRo vessels is progressing well
with expected deliveries in the second
half of this year.
The RoRo and ferry market has
weakened during the year due to newbuildings
entering the market.
Nevertheless, we consider it an interesting
business activity for well designed
and maintained ships for which there
will always be a prime market.
Stena Line is cutting costs
and consolidating
A world without taxfree has meant a
loss of msek 1,000 in income for Stena
Line’s passenger ferries. A powerful cost
cutting exercise has taken place and is
still going on reducing our cost base.
Prices have been increased and accepted
by our freight- and car-clients.
Passengers on excursion, especially day
trip passengers, have, however, in general
not accepted our price increases and